Home Lance Gurewitz Pressure to Panic: Do the Yankees Need Rafael Soriano?

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Pressure to Panic: Do the Yankees Need Rafael Soriano? PDF Print E-mail
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Lance Gurewitz Article Archive
Written by Lance Gurewitz   
Wednesday, 12 January 2011 09:38

SorianoWhile negotiations are a key part of any general manager’s job, they must present a particularly interesting challenge for the New York Yankees. With media that prey upon whatever weaknesses they find and fans whose hunger for championships is no less than voracious, it is clearly difficult to leverage information to the team’s advantage. General manager Brian Cashman generally does what he can to play hardball—with perhaps his greatest success coming from Derek Jeter’s new contract— but even so, when the Yankees have a need, everyone knows it. Even more importantly, everyone knows they have the money to fill it. Naturally, then, when the Yankees need a top player—or even if they can afford a top player they don’t really need—fans and media alike start clamoring for a deal to happen. More often than not, the Yankees make at least one such offseason splash, Cliff Lee’s shock of the world notwithstanding.

Speaking of Cliff Lee, it is partly thanks to his decision—and Andy Pettitte’s frustrating lack thereof—that the Yankees once again face pressure from the fans and media to make that offseason splash, but they have precious few options as far as how to do so. In fact, they have a grand total of one: sign former Rays closer Rafael Soriano. Super-agent Scott Boras smelled blood in the water, and ever since he suggested that Soriano might not mind setting up Mariano Rivera, the rumor mill has connected Soriano and the Yankees more and more. However, Cashman refuses to take the bait that easily. In fact, he would have us think he has no interest in Soriano at all:

“I will not lose our No. 1 draft pick,” Cashman said. “I would have for Cliff Lee. I won’t lose our No. 1 draft pick for anyone else.”

With reports from rumor authority Jon Heyman of Sports Illustrated that the Yankees are still in on Soriano, however, one has to question whether Cashman is being honest or posturing to gain leverage, despite the challenge described above. The goal of this post is not to answer that question factually but rather to consider the relative worth of Soriano and that number one draft pick and take an educated guess.

As explained in Victor Wang’s oft cited research on The Hardball Times, the expected six-year surplus value—i.e., total performance value minus total salary—of the Yankees’ top pick is estimated to be $6.5 million. Intuitively, for one used to looking at these types of numbers, it seems hard to imagine that Soriano’s next contract will yield that much surplus value, but let’s test that claim. A method I like to use as such a test is to try to create an idealistic but, at the same time, very plausible situation and see if I can disprove my initial claim.

That process begins with the suggestion that if the Yankees sign Soriano to a three-year deal, he’ll match the best three seasons of his career. That would mean a total of 5.2 fWAR, which would be valued in the neighborhood of $28-29 million if player salaries grow by 5% annually. That means that in order to match the expected surplus value of the draft pick, the Yankees would need to sign Soriano for three years and about $22 million. In case you somehow think the Soriano camp might accept less than $8 million annually—especially from the Yankees—don’t forget about the Yankees’ luxury tax hit, which would equal 40% of Soriano’s contract, (see The Biz of Baseball Luxury Tax tracker). Now, in order to keep that $6.5 million surplus value, the Yankees would have to offer Soriano about $16 million over three years, which will come nowhere close to getting it done.

By now, the point should be clear, but just for good measure, keep in mind that the initial calculation of Soriano’s value was based on the assumption that he would match the best three seasons of his career. Even without further calculations, once one qualitatively takes into account the extremely high probability that he will not, there seems to be no way Soriano can give the Yankees the expected surplus value of the thirty-first overall pick in what prospect experts consider a very deep draft class, just as I initially suspected. Regardless, the pressure from outside the Yankees organization will continue due to impatience, risk aversion (or even fear), and a consequent tendency among casual fans to undervalue draft picks. However, as Brian Cashman tells us he already knows, he would do well to weather the storm and stick to his word.



Lance Gurewitz is currently a freshman at the Wharton School of Business at the University of Pennsylvania. He also serves as the MLB Trade Rumors Florida Marlins Team Coordinator. You can read and discuss his baseball analysis and other sports musings in 140 characters or less by following @LanceWG42 on Twitter

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